Insiders Put IBM Building All-In Costs at $115M

President Robert P. Weisz says his locally based firm is in contract to acquire the 609,600-plus-sf office building from IBM. Weisz refused to divulge any details to GlobeSt.com concerning the sales price.

Thomas L. Beneville, managing director, and SVP Nathaniel C. Rockett of Jones Lang LaSalle's New York City-based capital markets team have been marketing the property on behalf of IBM. The company, through a spokesman, also had no comment on the sales price or any facet of the pending transaction.

According to documents filed with the Westchester IDA, Weisz estimates that construction related to the retrofit of the building will cost $20 million. He states in his filings that "Other Investments" will total $95 million for the project. A source knowledgeable about the deal says that the $95 million investment includes "acquisition as well as substantial soft and hard costs" associated with the project.

The 1133 Westchester Ave. building was put on the market by IBM earlier this year. The Armonk, NY-based computer giant had occupied most of the building along with operations from Starwood Hotels & Resorts Worldwide. IBM has shifted a considerable amount of personnel to other properties. At present, the building is about 70% vacant. Weisz says that IBM has signed a lease to occupy approximately 10% of the building if the sales agreement is finalized.

Weisz says that the repositioning will be similar to his firm's successful retrofit of the former Altria Group complex in Rye Brook, NY into a multi-tenanted property. The firm, which purchased the 520,000-sf complex in 2004, now has that complex more than 90% leased.

The closing on the 1133 Westchester Ave. building is expected sometime in November. Weisz says he plans to add numerous amenities at the complex including: two restaurants, a cafeteria, a bank branch, beauty parlor, portable car wash, a fitness center, dry cleaner and sundry shop.

In addition, the property, which sits on 70 acres, has an FAR that would allow for another 300,000 sf of development. "We will be considering a hotel as part of that development," Weisz says. That would be a facet of the second phase of the project.